Apparel Leaders Concerned About Labor, Insurance Issues
The California fashion industry is in dire need of higher- skilled labor and relief from the high cost of tax and insurance regulations, said apparel industry leaders who met with educators, lenders and other assistance providers during a meeting with the Los Angeles County Regional Business Assistance Network (RBAN) April 24 in the California Market Center in Los Angeles.
Co-hosted by the Los Angeles County Economic Development Corp. (LAEDC), the meeting featured a panel of apparel and home-furnishings industry leaders which included California Fashion Association Executive Director Ilse Metchek, Vera Campbell of Knitwork/ Design Zone, Helen Namkoong of Kid Rascal, Francisco Peneda of Cisco Bros. Furniture, Tammy Chatkin of 24 Seven and interior designer Richard Herb of Herb Charles.
The panelists presented a number of concerns about the cost of doing business and the pressures of foreign competition.
Labor concerns
Most agreed that the apparel industry needed higherskilled entry-level workers.
Apparel manufacturer Vera Campbell of juniors and kids’ line Knitwork/Design Zone said graduating students and entry-level workers are lacking basic skills like math and English.
“I’m seeing students with two- and four-year degrees who can’t tell me how many inches are in two yards or how many units in a gross,” said Campbell. “It’s pretty shocking. We deal with pre-packs in six and 12 pieces, so they have to know how to add.”
Helen Namkoong of Kid Rascal said, as a smaller manufacturer, she sees many workers coming into the market with unrealistic wage expectations.
“They’re coming in wanting $15 to $20 an hour and the smaller companies can’t afford that,” she said.
Chatkin, whose 24 Seven placement agency provides workers for the apparel industry, said there has also been a dearth of students who are skilled in technology vital to the pre-production process.
“We have a unique problem because most of the incoming workers six years ago never got the training in [graphics technology] so we have about 60 percent to 70 percent of the design force lacking these skills,” said Chatkin.
Global changes
Campbell added that as the industry becomes more globalized it will need more specialized positions such as import/export coordinators.
Aside from the labor issue, the panelists agreed that government regulations are stifling business. Metchek said that exorbitant workers’ compensation costs, which have ballooned to 200 percent to 300 percent over the past three years, has been a major concern.
“We’re on a major letter-writing campaign. If this continues, companies will be hiring fewer people,” Metchek said. Peneda said the furniture industry is facing similar problems with rising insurance costs.
Labor regulations have also hampered operations for apparel employers by requiring more monitoring of undocumented workers, said Namkoong, who uses contractors almost exclusively to produce her line.
As a result, she’s considering moving production offshore, where she said minimums have been reduced to favor smaller firms like hers.
“In China, you used to have to do orders of 1,000 pieces minimum, but they’ve gone down to 200 to 300,” she said.
Despite these concerns, the West Coast fashion industry should stay strong, said the panelists.
“There are few public companies and lots of entrepreneurs here. Everyone’s looking to California for innovation now,” said Campbell.
For more information about RBAN, call (213) 236-4822. —Robert McAllister
